Budget Showdowns, Government Shutdowns, and Paul Ryan's Proposal

Wednesday, April 06, 2011

Welcome to Politics Bites, where every afternoon at It's A Free Country, we bring you the unmissable quotes from the morning's political conversations on WNYC. Today on the Brian Lehrer Show, Congresswoman Marsha Blackburn (R-TN) discussed the budget negotiation on the hill; and John Heilemann, national affairs editor for New York Magazine;Paul Starr, professor of public policy at Princeton; and Ed Haislmaier, health policy researcher at the Heritage Foundation discussed Paul Ryan's 2012 budget proposal.

This is really class legislation. It's a tax cut for people at the top, and it's a block grant of Medicaid and a limit on the amount of money for Medicare, and the real result of that is lower income people are going to get screwed.

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The 'Right' Approach to Medicare and Medicaid

Congresswoman Marsha Blackburn has faith in Rep. Paul Ryan's newly-introduced budget, which slashes federal spending by $6 trillion over the next decade. Two of the most controversial means to that end are turning Medicaid payments into block grants for each state, and changing Medicare into a voucher program for seniors to purchase private insurance.

With regard to the latter, Blackburn and Republicans tout increased flexibility for seniors in addition to lower costs.

[Seniors] would like to be able to have a support payment every year to stay in their health insurance plan with an employer because they're not planning to retire at 65, they might be planning to retire at 72...What you're seeing in the Ryan plan is the opportunity for seniors and individuals to choose how they plan to work, when they want to retire.

Pro-choice, or no choice?

Professor Paul Starr disagreed with Blackburn's characterization of the Medicare proposal. He said that by taking the government-run program off the market and leaving only private insurers to cover seniors, you're literally reducing the number of options, not offering more. Losing traditional Medicare is also dangerous simply because private businesses would no longer have a federal yardstick, Starr said.

Medicare beneficiaries can choose private plans now. To say this increases choice is misleading; it's diminished choice. They'd no longer have the option of the traditional Medicare program. By eliminating that, this proposal would eliminate all of the rights people enjoy under Medicare. There would be no guarantee that you could buy the benefits people now have.

A flawed system

Ed Haislmaier of the Heritage Foundation—a conservative policy research center responsible for many of the estimates in Ryan's budget—took issue with Starr's argument, countering that private insurers are better at controlling costs and serving beneficiaries than Medicare. By not giving enrollees the choice of how to use their own trust fund, the federal government ends of paying more money for less efficient care.

Who's entitled to something under Medicare? Medicare doesn't actually entitle the beneficiary to anything. People who get the entitlement are doctors and hospitals; they're entitled to get paid if they do things. The proposal says the beneficiary is entitled to a certain amount of money, then the beneficiary has increased power and choice on how to spend that money.

'This is really class legislation'

For Paul Starr, the bottom line is that it's hard to trust Ryan's Medicare and Medicaid changes considering his budget proposal also includes a ten percent tax cut for corporations and the wealthiest Americans.

This is really class legislation. It's a tax cut for people at the top, and it's a block grant of Medicaid and a limit on the amount of money for Medicare, and the real result of that is lower income people are going to get screwed.

John Heileman of New York magazine felt that Starr was correct. He said that increasing the austerity of entitlement programs without a corresponding increase in federal revenues focuses the pain on the lower class in a manner that's hard to ignore.

There's a view that would say, look, if you are serious about reducing the deficit, if that's your primary goal. and not your primary goal being to reshape role of government in American society, then you need to take on entitlements, but you also need to deal with the revenue side of picture. The fact that he's left the Bush tax cuts intact certainly skews the program such that people who come out better are people who are richer, and people being asked to shoulder the burden are those on the lower end of the income scale.

Closing loopholes enough?

Ed Haislmaier said it was a mistake to think lower tax rates necessarily mean lower tax revenue. Historically, the federal tax code has swung back and forth between high tax rates with a lot of loopholes and deductions, and low tax rates with few ways to get around paying. According to Haislmaier, revenue evens out to be in the same ballpark either way. Ryan's proposal isn't a radical shift from the norm, he said; it just opts for the low-tax, low-loophole arrangement.

Regardless of lower rates with fewer loopholes or higher rates with more loopholes, the government takes in about the same amount, which is about 20 percent of GDP. What Representative Ryan clearly says in this bill is that his tax reforms would bring that down to that historic level by lowering rates but closing loopholes and deductions.

What really matters

Whatever one's feelings about Ryan's proposal, John Heileman said that the Representative exhibited a lot of political courage by coming forward with these gutsy, unpopular reforms. Ryan's timing is especially interesting given that the government will shut down Friday night if Congress can't come to an agreement on this year's budget. Heileman believed that by pivoting attention to next year while this year's work remains on the table, Republicans may be trying to appease their more conservative constituents who feel the current round of spending reductions aren't enough.

What they wanted to say to the further right elements of the party that are right now applying pressure that are making a short term deal for 2011 budget hard to do, it's saying, 'Look guys, if we're going to fight a huge fight, let's have it over something that matters. This is where the big stakes are. Let's not waste all of our cannon fire here and risk shutting down the government over something that is in fact trivial.'

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Stephen Reader covers politics for It's a Free Country, WNYC's interactive politics site. He joined the station in 2010 and has also worked for Studio 360, WNYC's Peabody Award-winning show about art, culture, and creativity.

Comments [72]

zuwena
from Manhattan

Haywood. This is not even a vaguely disguised plan to support the insurance companies that have been ripping off the public for years. Why can't we accept that single payer works. Why not tweek it to keep it healthy and viable for all. Some of european countries have done a better job and we ought to employ those tactics. Block grants--ha, this will bankrupt States and give full reign to some unscrupulous legislators and their honchos who will get 50% of the money. This is a joke.

I think you need to vet these people from the conservative think tanks, along with Paul Ryan. This afternoon, we learn that Alice Rivlin says she " told the Republican she doesn't support the final version of the measure he wrote into his budget--a provision he referred to as the Ryan-Rivlin plan. Goodness, where is this man's sense of honesty????

Sometimes the face of The Grim Reaper,can look like a blue eyed, dark hair,man.Paul Ryan's plan if put into effect,will affect adversely the lives of millionsof people.

The Rich will pay even bigger yachts,more luxury condos, pay for Yale,Harvard, without batting an eyelash,while the poor, middle class willdie for lack of healthcare, properhousing, or in prison for shopliftingbaby formula, food items.

I’m so sick of all this bogus nattering about the deficit and entitlements. If we get out of Afghanistan and Iraq, and wealthy individuals and corporations pay their fair share of taxes, there would be no deficit. We would have a huge surplus, and every US citizen could have free medical care.One expects this tired old BS from Republicans, but allegedly liberal Dems like Schumer are no better. He (and almost every other politician from both parties) are funded by corporate interests and will never address the root causes of the US’ financial woes. Maybe it is time for average Americans to look to the Arab world and take to the streets.

This Ryan proposal is one of the stupidest ideas I have ever heard, and I don't say things like that often. It assumes that whatever fixed dollar amount is awarded to seniors will keep pace with growing costs, it assumes that the private sector does a better job of controlling health care costs and there is no evidence of that, and he assumes that "consumers" have enough medical knowledge to know what services they need and how much they should cost. Please. We are not buying used cars here.

The ACA actually does take aim at galloping increases in Medicare. We need to allow it to work and then we need to see how much is actually saved. Numerous economic models show that it will work.

Regarding Ryan's political courage or lack thereof, the real question is how this plays in his highly gerrymandered district. If he were running for President, the plan would be politically courageous in the same way going on a probable suicide mission is courageous. Since he won his last election with 68% of the vote, I'm unimpressed.

What insurance company would sell a policy to a 65 year old? They are in the business to make money.

Unless you die suddenly, everyone gets sick and dies. In the process they either use health care to stay well and prolong their life or they don't, and die.

A government voucher of any amount will never cover the health care costs of the vast majority of old people. Bypass surgery, cancer treatment, joint replacements are all out of the financial of the majority of americans.

The Ryan plan will result in earlier death, old people without health insurance or health care.

Perhaps this is what republicans and tea partiers want; someone reporter should have the courage to ask them and get them to tell the truth.

"Economic child abuse"!!! This woman is crazy. Missouri wants to repeal child labor laws allowing children under 14 to work; a child could work during the school term without a work permit; a child under 16 can work in motels/hotels - and without restrictions on hours. And it's not just Missouri: Republicans in Maine want to be able to employ people under 20 for $5.20 and eliminate the number of hours a minor can work. Republican Senator Mike Lee of Utah has called the federal ban on child labor unconstitutional. These class-warring, lying Republicans say they need these cuts so "our" grandchildren are not drowning in debt. Let's be real - they don't care about "our" grandchildren, they only care about their grandchildren who will never have to take jobs for $5.20 an hour or be exploited as a 14-year old working in a restaurant or hotel. That kind of job is only for our kids - their kids are entitled. Changes to child labor laws might (might!) make sense if there was a labor shortage - but there's a labor glut. We have over-educated adults underemployed and Republicans want to make it easier to access an even cheaper labor pool. This is so clear - we need to wake up and do everything we can to protect ourselves and our children from these nuts. Brian stop being so respectful and start getting real with these positions.

@ RLewis - If Ryan's plan goes forward as is (which it won't), no one would ever know how Medicare/Medicaid would stack up against other "health payers" (insurance plans) because it wouldn't exist.

The fact is that HEALTHCARE in America needs a comprehensive overhaul in terms of service delivery and the way it gets paid for. All other talk about healthcare cost containment is virtually worthless without addressing it in a systematic way.

Gee, now why didn't I think about bargaining with several different hospitals when I had to go to an emergency room with what turned out to be third degree burns?

And, then, why didn't I take some time, maybe a day or so, to bargain with the St. Barnabas Burn Center and the burn surgeons there, along with some out of state, out of region burn centers I don't even now about?

Is this Heritage guy crazy? What world does he live in?

Oh, and I didn't know if my insurance plan covered ambulance service and tried to call from the ER to find out, since the ER said I needed to get to the burn center ASAP. But my insurance company, a very big well known one (think very beginning of the alphabet), did not have any personnel on staff after 7PM and I was supposed to get on the internet with any questions. Too bad for me, I didn't have a smart phone with internet access nor did the ER have patient internet access....

So, feeling slightly less in pain due to the morphine administered earier as I was debrided from my toes to my tush, I said I would have to drive myself (I'd driven to the ER, never thinking I was that seriously wounded).

Yeah, it's really easy trying to be a "smart consumer" of medical care!!!

Oh, and anyone ever tried to pin down your insurance company on what exactly is covered? Get many varying answers? Like something as straight forward as an ultrasound, which had been done twice a year for cancer checkups? And I would still get three different answers from three different phone reps? Escalating to higher levels takes days?

Grrrrr. Now they want everyone 65 and over to go through that kind of economic terrorism!

(Yes, this is an emotional, gut churning response to these rightwing ideas, even when adopted by corporatist Democrats.)

Perhaps it’s time for the progressives, the middle class, and the poor, who find this proposal repugnant, to form a strategic alliance to defeat the healthcare industrial complex. The one thing we can all agree on is that this plan is a shameless and cynical fiasco designed to kowtow to the insurance industry, allowing them to line their pockets at the expense of the elderly and the poor. The Ryan plan is nothing but another corporate welfare scheme--the only winners are the soon-to-be subsidized insurance companies, who will be laughing all the way to the already-subsidized banks.

I am offended by the Republican/Tea Party lack of respect for the poor and the needy. Even for the middleclass which is shrinking. In there opinion, anything that helps anyone is bad and anything that supports the rich is great. This is not what America should be standing for!!

Why I thought I would be the only one offended by the Blackburn comments and your failure to call her out on not answering your question I don't know. But now, having gone through the comments that preceded mine I can only be buoyed by the knowledge that there are lots of sane folks out there. Brian, you on the other hand, are becoming a big disappointment. If you can make it clear to a guest that s/he is not responding to the question you need to hang it up. Eliminate government jobs, eliminate or reduce medicare, medicaid, etc , let the GEs off the hook for their fair share of the costs of running the country--this is not a difficult concept for even a high school graduate to understand. When the middle class is gone and the social security and pensions have been reduced to poverty status where will the money come from? My annual social security from a professional job, before taxes and medicare payments, is $20,000 after 48 years in the workforce; thats about 1/6th of what a one-term senator gets. Is this fair? Who doesn't understand this?

Only in America do people pay that much deference to a conservative political move. Paul Ryan is in no way starting a "coversation." He is presenting "outlandish" (according to the Economist) statistics based on little if any reality and threatening a government shutdown in an attempt to make the Democrats look weak & overmatched. That is cowardly and thuggish. And it's dicouraging that nobody is returning salt-for-salt.

To the Republican Speaker -- In a nutshell, heads we win, tails you lose.

As a Medicare recipient, there is choice now, retirement age is not 65. Every year I receive numerous offers from numerous insurance companies to get my "business." I do not appreciate the opportunity for the rich to get richer (cut their taxes) and the rest of us to "bear the burdens."

I didn't know who this was initially, but it was clear she was very rightwing.

I think she let some of the rightwing auterians' plans out today: Instead of talking about working until 69, as the chairs of the Obama Cat Food Commission did, she talked about working until 72 or 75.

Guess she's not aware that longevity for those not in upper income echelons is declining. Then again, maybe they do know that and want the poorer among us to just Hurry Up and Die once they no long provide Cheap Labor.

I have major agida from listening to this rightwinger!

(And Alive Rivlin is giving me a similar reaction; what's up with her??)

Brian, here is Marsha Blackburn's voting record. I think it would be valuable if you would make this kind of information available for all your guests who are elected officials, where applicable. http://www.ontheissues.org/House/Marsha_Blackburn_Homeland_Security.htm

Medicaid should absolutely be WHACKED big time!!!! (Oh my gosh, did he say that ???!!! The poor, the homeless, the elderly, the ...fill in the blank...)It is now 40%(!!!!!) of New York state spending. This is out of comntrol.

Bye Brian - you have catered to one too many Tea Party member. I'm (and perhaps many others) are done with your amoral and mendacious approach to the trouble this country is in. Good luck to you and your Party.

Why do you let her repeat her talking points without calling her out for not really answering your specific questions? Her bad faith is outrageous!! She might represent her selfish republican constituency, not the American People. She can't even admit that there is a serious income inequality in this country... it's offensive! She is offensive!

@ Rep. Blackburn - You are incorrect that there was no proposal by the Democrats - they responded to the $60 billion in cuts with a proposal of $33 billion. Period.

The Republicans are uncompromising to a ridiculous extent; they only control 1 out of 3 of the elected Federal bodies (executive and legislative) and they act like they run the show! It makes me wonder if they have heard of either the 3 branches of government or the concept of negotiations before...

You are correct that the Democrats let the budget go on too long, and I'll bet Pelosi and Reid are kicking themselves now.

Pandering to the right wingnuts to try to hold on to government funding for NPR is shameful and won't work anyway. Please go back to having intelligent guests and leave this woman to Fox, where she belongs. I'm beginning ot have buyer's remorse for being a member.

So now we can plan for when we want to retire? What world is she living in. I'd like to retire at 45, but I will probably be *forced* to work until 75 because I couldn't afford to stop working earlier. She obviously has zero knowledge or concern for what people in the real world are actually facing.

A series of false choices are presented by the Republicans to achieve one goal, TO MAKE THE RICH RICHER at the expense of the middle class, the poor, and now seniors. This is not a choice -- these are choices that they are making to pay less while taking more from our society at every turn. To what end? To buy luxury products, create lazy offspring and eventually a failed nation. But, they will be on vacation playing golf in Scotland when the revolution occurs.

Economic child abuse?! Once again, more insanity spills out of my radio.

I am so depthlessly tired of hearing people of both sides of the aisle talk about cutting spending. I don't believe that any one of them is truly committed to making real sacrifices - like ordinary people do - in the name of financial restraint. The fact that military action continues in Afghanistan, Iraq, and now Libya gives lie to the whole farce of sincerity about cutting spending.

Why is WNYC having guests on and just letting them use the airwaves to ramble on about their platform? Where's the dialogue? Where's the questioning of what they are saying? Asking of facts that support their point of view? If I want talking heads, I'll tune into CNN.

Brian describes Ryan's proposals as "ideological"--they are ideologically RIGHT WING--Why don't you describe them that way? Why don't you ask her why it's okay to cut corporate taxes while destroying medicare and medicaid??

If this representative isn't going to answer any questions or offer anything even remotely specific, why bother having her at all? I could have given this interview just as well using the same talking points.

On another note, why is nobody screaming about redistribution of wealth with the Ryan plan? He's stealing from the poor (Medicade) to give to the rich in tax cuts.

Would someone please challenge these people when they say "the American people have spoken." The American people who spoke are the Tea Party activists whose votes had a disproportionate effect on the last election because of typically low voter turnout. Most of the American people have yet to be heard because they haven't been motivated vote.

Brian -- You're not even mentioning the real problem. Medicare and Medicaid are in trouble for the same reason the whole economy is. We spend 16% of GDP compared to 9% in other industrialized countries that get better healthcare outcomes. If we got healthcare costs under control, Medicare, Medicaid and the rest of the budget would be much closer to balance. The solution is not less healthcare. It is cheaper healthcare.

The second "R" on the show on the budget who really does not want to be pinned down on specifics. I am ok with cuts but identify something. Also, these are the same people who want to cut funding to NPR. At least admit it!

Brian--Ask her why we can't tax the rich instead of the poor, instead of Medicare recepients, instead of Medicaid and schoolchildren and on and on.... If we have to bear the burden, so should the rich. That "entitlement" answer is a cop out.

I'm having one of those crazy Bush Moments, where the most absurd, dangerous and often rude path is being treated as a normal talking point.

If liberals put our least fortunate first (Medicaid & social services for example) and so called conservatives put the most fortunate first (keeping the trillion dollar tax break intact, GE/ Exxon/Big Pharma tax windfalls), in terms of cuts, then for once, I believe the politicians. There really is no room for compromise. But aside from a handful of soulless billionaires, who on earth voted these people as their representatives? And on the liberal side -- WHERE IS THE HOPE AND CHANGE? I'm willing to fork over my tax money for the roads and for the poor -- but for GE? It's feelin' like the aughts...

The tea party, because it is extreme and unconpromising, has lost this conservative. I also note a tone of disrespect for the President. That is unacceptable. This Reagan-democrat, turned Obama-republican am voting Obama, 2012. Tea party will join the ash heap with the Bull Moose party and Whigs. They have insured a Obama victory.

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